September 22 Briefs and Notes

September 22 Briefs and Notes - Note on Option Contract...

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September 22, 2008 Note on Option Contract When there is an option contract, the mail box rule does not exist. The offer is accepted when it reaches the Or. Note on Offers in International Sales The A is not final until it is received, but the Or cannot revoke his offer once the A has been dispatched in the mail. F. Termination by Counteroffer and the “Battle of the Forms” 1. The Common Law Except with respect to option contracts, the offeree’s power of acceptance generally terminates when, rather than accepting, the offeree makes a counteroffer. The rationale for this rule is that a counteroffer is impliedly also a rejection. Effect of a counteroffer. At CL, the acceptance has to be a mirror image of the offer and if anything was different, it was a counteroffer and a rejection. 2-207, changed this law. If you change the price, or the quantity, this would be a different term or you might add a term, you add an arbitration clause. When you add a term, it must be something substanty. Example: I will sell you my car for $400, I accept but you only get the money when you give me the car. Livingstone v. Evans Alberta Supreme Court, 1925 Law: When an offer has been rejected it is hereby ended and it cannot be afterwards accepted w/o the consent of him who made it. Facts: Df Evans wrote to PL offering to sell him land for $1800 on terms (not a cash sale, not all at once). The day of receipt the PL wired back a counter-offer, give you $1600 cash all at once, to which the Df did not accept, said cannot reduce price, but indicated original offer is still there. PL then wired back that he accepted the original price. Reasoning: The Pl’s telegram was undoubtedly a counter offer. It put an end to the Df’s liability under their offer unless it was received by the telegram in reply to it. The Df’s reply “cannot reduce price,” was a renewal of the original offer. It has one meaning, that df was still standing by the original offer and still open to acceptance. Issue: Whether the counter-offer of the PL was in law a rejection of the Df’s offer and freed them from it? Procedure: Specific performance judgment for the PL Holding: Counter offer was not a rejection. Notes from the Case: Problem 29 : Not a contract because offer was counter offered. 2. The Original Battle of the Forms
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The A need no longer match the offer exactly. As long as the A is meant to be an A, it may contain new of different terms. Subsection 2 allows the new terms to become part of the contract unless the original offeror objects to them or they would materially alter the original offer. If the new terms are striken, the contract is formed according to the terms of the offer.
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September 22 Briefs and Notes - Note on Option Contract...

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